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Do I have to file a joint bankruptcy with my spouse?

| January 30, 2018

It is no secret married couples do a lot of things together, such as raise children and pay taxes. Something else they can do as a unit, but do not have to, is file a joint bankruptcy. In other words, one spouse may file bankruptcy even if their partner does not.
 
It is important to note only a person who seeks bankruptcy protection is impacted by that filing. Therefore, for example, if a wife files Chapter 7 bankruptcy, but her husband does not, only her debts and assets are taken into consideration in her case. Certainly she must list all of her debts, including those she has jointly with others, in her bankruptcy petition, but the filing pertains only to her. If a debt is dischargeable, her legal responsibility to pay it once the bankruptcy is completed is extinguished but continues for her joint debtors. The other people with whom she entered into the joint debt continue to be obligated on it since her individual bankruptcy filing impacts only her.
 
In other words, a creditor may still seek to collect the entire amount of the joint debt from the spouse who did not file for bankruptcy protection.
 
In Georgia, one benefit of a married couple filing a joint bankruptcy is that exemptions are doubled. Exemptions are laws allowing debtors to keep specific assets up to a certain monetary value, even if they file bankruptcy. That way, people are assured they will not lose everything they own despite seeking bankruptcy protection.
 
So, for example, current Georgia law allows a single debtor to keep up to $21,500 of equity in their primary residence when they file bankruptcy. However, if a married couple files a joint Chapter 7 bankruptcy, the exemption is doubled.
 
The experienced legal team at Morgan & Morgan is well-equipped to discuss your financial situation to help you determine whether it is wisest to file an individual bankruptcy or a joint case with your spouse. Give us a call or contact us through our web site to schedule a free initial consultation.

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